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Mortgages for Junior Doctors 101

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Mortgages for junior doctors 101

As a junior doctor, your circumstances can make it challenging to secure the mortgage you want. It’s important to be well prepared and to be able to prove your income in a way that lenders will understand.

Due to the nature of applications by junior doctors, working with a specialist mortgage broker could be a good choice. Specialist brokers will be able to take into account your individual circumstances and work with lenders who do also.

Securing a mortgage as a junior doctor can be difficult

Unfortunately, junior doctors can be at a disadvantage when making a mortgage application when compared with other professionals. While everyone's circumstances are unique, there are a few reasons junior doctors may struggle to make a successful mortgage application:

Long training periods and student debt

Due to the long time required in education and training, doctors are comparatively older than other professionals by the time they enter the workforce.

Many junior doctors are starting out their careers with large amounts of student debt - another factor that can negatively affect a potential mortgage application.

Rotations and short-term contracts

The nature of practising as a junior doctor is often one of some level of instability as far as traditional lenders are concerned. With many junior doctors on short-term contracts, rotations and variable shifts.

A history of moving and changing addresses

Lenders typically like to see a lot of history at one particular address - again they view this as a sign of stability.

Again, many junior doctors can find this a challenge, often moving or having moved frequently in the early stages of their career.

If you've worked abroad, this will add another level of complexity to your mortgage application.

Your income can appear lower than it is...

Due to the nature of the job, your base salary income can appear low to lenders. Of course, this is likely being topped up by overtime and additional work. Yet unfortunately, many high street lenders may not take this into account appropriately when making a lending decision.

For this reason alone, it can be advisable to work with a specialist broker who can help you document your income in a way lenders are likely to understand. 

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Step one: take a look at your credit 

Regardless of which route you take - high street lender or specialist broker - your credit score will be an important factor in your mortgage application.

As a junior doctor, you may not have had much time in the workforce to build your credit score. If you have a low score or issues affecting your credit, don't worry, you can always build and improve your credit score.

How can I find out and improve my credit score?

Your credit score is determined by a variety of factors, and in fact, you will likely have multiple credit scores with different agencies. In the UK there are several credit reference agencies - these are organisations that determine your creditworthiness such as Equifax, Experian and Transunion.

Some of the most common factors affecting your credit score are:

  • Whether you're on the electoral roll at your current address?
  • Your previous address history
  • How you use credit (lenders are looking for responsible use of credit cards, loans etc)
  • Joint credit history (if you have joint accounts with your spouse/partner)
  • Any county court judgements, insolvencies or bankruptcies
  • Your immigration status and time resident in the country
  • Any inaccuracies

The best first step is to check your score and see where you stand. From there you can take steps to improve and change your score.

If you are concerned about your credit score, specialist brokers will be able to guide you through the application process.

Step two: how to determine what you’re buying for

When you’re considering a mortgage as a junior doctor, you should be very clear on the purpose of your proposed borrowing.

Are you intending to buy property as a long-term home or do you see it as an investment? Perhaps you're considering to let your new home in the future? Could you be likely to move frequently in the near term? Are you buying alone or with a spouse or partner? 

If you're recently qualified or considering moving in the medium term, you may benefit from more flexible terms. A specialist broker will be able to discuss your options in more detail.

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Talk to us for further information. Click here to enter a few simple details and one of our specialist mortgage advisers will be in touch. Your initial consultation is free of charge. 

Thinking of applying for a mortgage? Go through this checklist first

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